S&P 500
The S&P 500 had a volatile session on Monday, as we bounced around to essentially doing nothing at the end of the day. The range was fairly tight, with the 1900 level on the upper and causing resistance, but the 1870 level on the bottom was far too supportive. At this point, I suppose you can make an argument for some type of attempt at making a base, but I believe that it’s a bit premature to think that.
All I can do is play the charts that are presented to me, and with this I believe that a move above 1900 allows me to buy this market from a short-term perspective. It is not until we break above 1950 that I feel this market can be bought for any real length of time, so quite frankly I would be very quick to take profits at this point in time. I would also suggest that an exhaustive candle after short-term rally could be a buying opportunity.
NASDAQ 100
The NASDAQ 100 as you would expect did very much the same thing during the day on Monday. There is a lot of concern out there as far as risk appetite is concerned, and that will continue to be a bit of a weight around the neck of the NASDAQ 100, and pretty much any other stock market in the world for that matter.
I believe that if we can break above the 4200 level, we could bounce as high as 4350, but I again believe it is only a short-term trading opportunity to the upside. I believe that the sellers will come back into the market and I would of course be willing to take profits rather quickly. A resistive candle after a short-term rally could be a nice selling opportunity for short-term traders as well, so having said that I believe that we are going to continue to see quite a bit of volatility.
